The owner and managing director of Edinburgh printing specialist Capital Solutions believes costs are being driven up through a quarterly review practice known as a'memorandum of variation', which in effect resets the length of contract from the date of amendment.

He insists sales teams are poorly advising customers with the promise of new equipment, plus revised copying and document costs, in order to sign them up for more lucrative contracts.

However, struggling businesses and public sector organisations may have to stump up large payments to cancel so-called 'evergreen' contracts - an agreement which is automatically renewed after an agreed maturity period.

An internal government report looking at spending in the Department for Children, Schools and Families leaked last week highlighted one unnamed school having spent £35,000 on a £1,000 photocopier.

And Flockart recently advised a company whose costs trebled in just two years despite usage staying static.

He said: "Something as simple as a photocopier contract may not be signed off at board level because printing and copying is generally viewed as a revenue recurring expenditure rather than a capital expenditure.

"I recently had dealings with a company who tried to cancel their existing contract for 15 photocopiers, and the contract severance liability was more than £1million.

"This company was initially shown a monthly cost saving of a couple of hundred pounds a month under one contract, which wasn't viewed as requiring approval from senior management.

"But the contract grew and grew as a result of quarterly usage reviews over the space of two years from £25,000 a quarter to more than £65,000 a quarter.

"This quarterly usage review of services is actually a ploy to constantly increase the customer's usage levels and then amend the original agreement.

"That's where the catch is, because every time there is an amendment, the original term of the customer's contract is extended again by what's called a memorandum of variation.

"I have seen a report for a supplier's Scottish sales team last year, which had one sales person alone exceeding their monthly target by nearly 700 per cent, and nearly 40 salespeople exceeding their target by more than 100 per cent."

Previously Flockhart was instrumental in exposing abuses in contract terms in the copier industry in 1991, which led to a detailed investigation by the Office of Fair Trading (OFT) and the Finance and Leasing Association (FLA).

He said: "What we are seeing again is the practice of rolling up lease and service agreements, which makes it easy for the suppliers to exaggerate figures and increase the entire package each year, which can culminate into a vast sum for the customer.

The FLA are supposed to regulate the market, but there are a lot of finance companies operating outside the FLA membership.

"By using a universal draft agreement, the customer doesn't know if the credit agreement is coming from an FLA member credit company or one which operates outside the regulatory body."

The FLA, the main regulatory body in the UK for the leasing finance sector, currently has 55 business finance member companies.

Spokeswoman Helen Saxon said companies should make themselves aware of its Business Finance Code, though admitted many business to business finance companies operate outside their guidelines.

Alex McLaren, a forensic accountant with business recovery firm Begbies Traynor, said: "Some of these contracts are worded very cleverly, and what you often find is a very junior member of staff has signed the original contract.

"Companies should take a look at their existing contracts to ensure they are getting exactly what they are paying for in terms of actual usage." The OFT said it was not aware of any abuse of evergreen contracts, despite a lengthy investigation in 1991, and has no control over business-to-business contracts.